Proviso To Sec.61(2) Of IBC Allows NCLAT To Permit Appeal Filing Even After Expiry Of 30 Days’ Period But Such Period Shouldn’t Exceed 15 Days: Supreme Court

An appeal before the Apex Court was filed under Section 62 of the Insolvency and Bankruptcy Code, 2016 against the judgment passed by the National Company Law Appellate Tribunal, Principal Bench.

The Division Bench of Justice Sanjay Kumar and Justice Satish Chandra Sharma said, “Section 61(2) of the IBC prescribes that every appeal against an order of the Adjudicating Authority, i.e., the National Company Law Tribunal concerned, should be filed before the jurisdictional National Company Law Appellate Tribunal within 30 days. The proviso thereto, however, allows the said National Company Law Appellate Tribunal to permit the appeal to be filed even after expiry of the period of 30 days, if it is satisfied that there was sufficient cause for not filing the appeal within that time but such extended period shall not exceed 15 days.”

Factual Background

A Company Appeal was filed by DSK Global Education and Research Pvt. Ltd., first respondent, assailing the validity of the order of the National Company Law Tribunal, Mumbai Bench. By the said order, the NCLT allowed the interlocutory application filed by the Resolution Professional and approved the resolution plan submitted by the successful resolution applicant, Ashdan Properties Private Limited. The NCLT pronounced the order in the subject application. According to the first respondent, the said order was uploaded on the website on June 26, 2023. The appeal before the NCLAT was e-filed by the first respondent on July 25, 2023.

A certified copy of the impugned order was not filed along with the said appeal. Rule 22(2) of the National Company Law Appellate Tribunal Rules, 2016, mandates that every appeal filed before the Appellate Tribunal shall be accompanied by a certified copy of the impugned order. The first respondent received a certified copy on September 7, 2023 and seems to have filed the same only thereafter before the NCLAT. An application for condonation of the delay of 2 days in the filing of the appeal was filed by the first respondent, claiming that its appeal had been filed within the condonable period of 15 days.

The appellant and others filed their reply before the NCLAT, specifically raising the contention that the appeal was barred by limitation as it was filed beyond the statutorily prescribed period. The NCLAT did not deal with the issue of limitation insofar as the filing of the first respondent’s appeal was concerned.

Reasoning

The Bench explained that even if an appeal is entertained within the initial 30 day-period without a certified copy of the order, by granting exemption under Rule 14, it can only be for a limited period to enable due compliance with the mandate of Rule 22(2) by filing a certified copy at least at a later date and within the time stipulated by the National Company Law Appellate Tribunal. Such an exemption cannot be to the extent of completely dispensing with the filing of a certified copy, which would annihilate the clear mandate of Rule 22(2) of the NCLAT Rules, which categorically uses the word ‘shall’ to emphasize that an appeal must be accompanied by a certified copy of the order impugned.

The Bench further noticed the fact that the first respondent had casually e-filed an appeal on July 25, 2023, with neither an application for condonation of delay nor an application seeking exemption from filing a certified copy of the impugned order, rendering its appeal defective. An application for condonation of delay was filed much later, on September 22, 2023.

The Bench took note of the fact that it was at this time that a certified copy of the impugned order was filed without even seeking exemption or extension of time to do so. “These aspects ought to have been considered by the NCLAT as the statute peremptorily requires proper institution of an appeal in conformity with all the prescribed norms and it was incumbent upon the NCLAT to examine and verify as to whether respondent No. 1’s appeal was in due compliance with all such norms. More so, when the appellant herein had specifically raised the issue that such appeal was barred by limitation. The NCLAT erred in completely brushing aside this crucial aspect which went to the very root of its appellate jurisdiction”, it said.

Dismissing the appeal, the Bench said, “Thus, the impugned judgment delivered on merits is essentially a superstructure erected on an illusory foundation and cannot, therefore, be sustained.”

Cause Title: Ashdan Properties Pvt. Ltd. v. DSK Global Education and Research Pvt. Ltd. (Neutral Citation: 2025 INSC 959)

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